Looks like the Department of Education is paving the road to Pay As You Earn (PAYE) expansion. The ED has announced its intent to establish a negotiated rulemaking committee (http://www.regulations.gov/#!documentDetail;D=ED-2014-OPE-0124-0001).
As you can remember, Obama’s Presidential Memorandum issued on June 9, 2014, directed the Secretary to issue, within one year, proposed regulations that expand the PAYE plan to more Federal Direct Loan borrowers. Now, the ED is starting those regulations by first selecting a rulemaking committee from nominees.
The goal is to make the new PAYE repayment option available to borrowers by December 31, 2015.
Direct from the ED’s Announcement
“We intend to convene a committee to develop proposed regulations to allow more student borrowers of Federal Direct Loans to use the “Pay as You Earn Repayment Plan”, in accordance with the Presidential Memorandum issued on June 9, 2014, (available at www.whitehouse.gov/the-press-office/2014/06/09/presidential-memorandum-federal-student-loan-repayments). Section 1 of the memorandum directs the Secretary to issue, within one year, proposed regulations that expand the President’s Pay as You Earn Repayment Plan to more Federal Direct Loan borrowers by allowing additional Federal Direct Loan borrowers to cap their Federal student loan payments at 10 percent of their income. The memorandum directs the Secretary to seek to target this option to those borrowers who would otherwise struggle to repay their loans, and to issue final regulations in a timely fashion after considering all public comments, as appropriate, with the goal of making the repayment option available to borrowers by December 31, 2015.
After a complete review of the public comments presented at the public hearings and in the written submissions, we will publish a document (or documents) in theFederal Registerannouncing the specific subject areas for which we intend to establish a negotiated rulemaking committee, and a request for nominations for individual negotiators for the committee who represent the communities of interest that would be significantly affected by the proposed regulations.”
We’ll keep you posted on changes!